Reported by the Consejeros Editorial Team
Euronext is considering the possibility of creating a pan-European market for unlisted securities with the aim of competing with the London Stock Exchange Group in attracting small, private and fast-growing companies, according to a report published yesterday by Bloomberg, citing sources familiar with the matter.
This platform would enable companies to raise new funds and shareholders to sell their holdings, thereby differentiating itself from the LSEG’s private asset offering, which only allows the trading of existing shares and does not permit capital increases.
The discussions Euronext has held with clients for this purpose are still at an early stage and are not binding as regards the actual implementation of the plan.
Bloomberg explains that the discussions follow the EU’s consultation earlier this year on how to make it easier for private equity investors to sell their stakes, as the boom in venture capital and the growth of private equity have reduced the number of IPOs.
IPOs have also been affected by rising financing costs, which make it difficult for many private equity funds to divest from companies at valuations they consider acceptable. Companies that do eventually go public are now typically larger and often prefer to sell shares in the US, where valuations are higher, which is detrimental to Europe.
